TheBigDeal.com: “CMA investigation into price comparison sites welcome and good news for consumers. Too often price comparison sites do what is right for them not for consumers.”
Today (29 Sept 2016) the CMA launched an investigation into price comparison websites stating that there are concerns over the way they:
- “Display and compare deals, and resulting concerns over whether consumers trust them.”
- “Particularly in energy, concerns over not offering consumers comprehensive market coverage, and worries over transparency.”
- “Lack of transparency over business models, and particularly whether suppliers can influence how their products are represented.”
Will Hodson, co-founder of consumer collective TheBigDeal.com, welcomed the investigation:
“The CMA investigation is hugely welcome and good news for consumers. Price comparison websites use multi-million-pound ad campaigns to promote a cuddly image of themselves. But the truth is that they are hard-edged companies that make hundreds of millions in profit and there are major concerns about how they operate.
“In recent years, they have been caught hiding the cheapest gas and electricity deals from consumers online. They were also caught lying over the phone about what the best deals are so they could boost their profits. Too often price comparison sites do what is best for them not what is best for consumers.
“Polling from YouGov shows that only 22% of the public say price comparison sites are trustworthy when it comes to providing impartial information. There needs to be considerably more transparency over the way these firms operate. In particular, there should be much more openness about their business models and the commissions they charge. Transparency is a prerequisite for trust.”
YouGov polling on price comparison websites found:
- Just 22% say these sites are trustworthy when it comes to providing impartial information.
- Almost a third of people (30%) are unaware that switching sites are paid by energy companies for each switch.
- A huge majority of people (86%) says price comparison sites should ensure every user sees the lowest price tariffs regardless of whether they receive a commission or not from the supplier. Just 3% disagree.
- 70% say it’s a good idea for sites to publish how much money they make in commission per switch. Just 4% disagree.
The full polling results can be found here: https://thebigdeal.com/blog/New-poll-trust-PCWs
Full details about how the biggest price comparison sites were hiding the cheapest deals online and over the phone in the notes to editors below.
For further information contact Henry de Zoete at henry(at)thebigdeal(dot)com or Edward Molyneux at edward(at)thebigdeal(dot)com.
NOTES TO EDITORS
TheBigDeal.com research exposes price comparison sites hiding cheapest deals online and over the phone
On 20th October 2014, TheBigDeal.com published research that showed that the Big Five switching websites (Go Compare, Compare the Market, MoneySupermarket, uSwitch and Confused) all hide the cheapest deals from users because they don’t get paid by energy companies for them. The full research including over 200 screenshots taken over 13 weeks can be found at: https://thisisthebigdeal.com/blog/research-into-price-comparison-websites
On 2nd February 2015, The Big Deal published similar research except into activity over the phone that found that all the Big Five switching websites (Go Compare, Compare the Market, MoneySupermarket, uSwitch and Confused) hid the cheapest deal when talking to customers. The full research including recordings and transcripts of the phone calls made can be found at: https://thebigdeal.com/blog/PCW-Miselling-Over-The-Phone
This research led to an official investigation into the behaviour of the Big Five price comparison websites by the Energy and Climate Change Select Committee.http://www.parliament.uk/business/committees/committees-a-z/commons-select/energy-and-climate-change-committee/inquiries/parliament-2010/energy-price-comparison-websites/
The energy regulator Ofgem also tightened up the rules around comparison sites following our investigation: http://www.bbc.co.uk/news/business-30912626
TheBigDeal.com is a consumer collective focused on reducing people’s energy bills. We bring together hundreds of thousands of consumers and use our collective buying power to create exclusive deals.
Launched in March 2014, we now have over 200,000 members and continue to grow. 62% of our members have never or hardly ever switched before – these are the very people who have been let down by the energy market for too long. Moreover, 60% of our members are over the age of 55 and 30% over the age of 65. We have saved the British public over £15 million since we launched.
TheBigDeal.com is a start up business and charges a commission to energy companies. Unlike price comparison websites we are 100% transparent and publish the exact amount of our commission. For our current switch that is £40 for a dual fuel (both gas and electricity) switch. This compares to £50 to £100 for the main price comparison websites.